Recent Court Decision on Matrimonial Assets

TBZ v TCA [2017] SGHCF 18

Decision date: 28 July 2017
Valerie Thean JC
Family law – Matrimonial Assets – Division
Family law – Maintenance – Assessment
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Facts

• Husband is 55 years old. Wife is 54 years old. Parties were married on 20 October 1991. Husband is a neurosurgeon. Wife is a general practitioner with her own clinic. Both worked full-time since their marriage.
• There are three children – 25, 24 and 22.
• In June 2013 when W left matrimonial home, children became polarized. Eldest took H’s side while younger two took W’s side.
• In July 2013, H began a relationship with A. H and A had a child, B, who was born in March 2014. W was not informed of B’s birth. During the course of a contested PPO trial, H admitted to B’s birth. The trial also culminated in a PPO being issued against H in March 2015.
• H commenced divorce in April 2014. IJ granted in March 2015. IJ recorded that parties had agreed for W to have care and control of the younger son who was 20 then. W also did not ask for maintenance for herself.
• Remaining AM were adjourned to chambers.

Division of matrimonial assets

• Operative date
  • [8]: As a general rule, operative date will be date of the IJ, unless the particular circumstances of justice of the case warrants it: ARY v ARX [2016] 2 SLR 686
  • [12]: Once an asset is regarded as a matrimonial asset, it ought to be valued as at the AM Date, unless a departure is warranted by the facts: TND v TNC [2017] SGCA 34 at [19].
    • But when parties agree that a particular date should be used as the date of valuation of the matrimonial assets, a court should generally adopt that agreed date unless there is good reason not to do so: TND v TNC at [24].
• Pool of matrimonial assets, dissipation and valuation
  • [13]: W contends that H was dissipating earnings and money in bank account. She contends that since H’s dissipation was so substantial, only assets in joint names shall constitute the pool of assets. This effectively meant that the N, BS and B properties will constitute the pool but the R, A and AMK properties will not.
  • [14]: Court held that it is not appropriate to segregate the R, A and AMK from the asset pool. AMK was purchased in the early years of the marriage where both parties worked together for the good of the marriage. R and A properties were purchased in the last period of the marriage but the H contended that they were paid for by the W using monies from joint account.
  • Court considered held that in light of the mandate to “treat all matrimonial assets as community property ... to be divided in accordance with s 112”, it was more appropriate to consider all properties, and to deal with the dissipation separately.
  • [32]: Court was satisfied that both sides have embarked on a mutual hide and seek exercise in relation to their wealth. In this case, the court held that justice would be well served in making a single assessment rather than to add the appropriate sum to the pool.
  • [16]: Wife effectively asked for a later liability date in some cases and an earlier one in others.
  • [17]: Court held that the liability date should be as similar dates as practicable ought to be used to reach a fair result.
    • [26]: In relation to the valuation date to be used, different dates may be used for different categories of assets: Yeo Chong Lin at [39].
  • For properties, the valuation may fluctuate. In a falling market, if the date is too late, there may be hardship. If the date is too early, there may be an unintended and uneven windfall. Funds in a bank account are easily moved or spent.
• Assets accrued post-IJ
  • [23]: Assets should be delineated as at the IJ Date. Beyond the IJ Date, they could not be said to have been earning or working for the purposes of a joint family life.
  • A consistent and uniform date should be used as the operative date for the determination of both parties’ earnings.
• “Enhanced earnings” from professional licence as a matrimonial asset
  • W wanted to claim a share from H’s “enhanced earnings” up to the date of his retirement. She contends that but for her support, he could not have pursued his fellowship and obtain his neurosurgery specialisation.
  • W cited two NY decisions where the NY CA gels that a professional licence could constitute matrimonial asset liable to division to the extent that it was acquire during the marriage.
  • Court held that these NY cases do not apply in Singapore given the entirely different statutory basis. There is no principle in status or case law to treat professional licence as property in such an expansive way or to claim for future earnings.
• Direct Financial Contribution
  • [50]: When parties sold the K property, the sale proceeds were utilised towards the acquisition of the N and AMK properties. Court held that the K proceeds should be traced into parties’ contributions towards the N and AMK properties: Ang Teng Siong v Lee Su Min [2000] 1 SLR(R) 908 at [15] - [16]
  • H’s DFC was about 51.4% of the total pool.
• Indirect Contributions
  • [59]: All things considered, the court was of the view that there were equal indirect contributions.
  • H made the lion’s share of the financial indirect contribution but W contributed very significantly in the early years of the marriage when the H was overseas for specialisation.
  • Long marriage of 24 years, and both parties worked full-time throughout the course of the marriage. As doctors, they worked long hours, including on weekends and public holidays.
  • Children were sent to boarding school and parties were heavily reliant on domestic helpers.
• Final Ratio
  • Final ratio will be 50.7% in favour of the H and 49.3% for the W.
  • H lived rent-free at the N property but the court did not take this into account for adjustment to the final ratio. W did not rent out the other properties in her sole name and she and the younger children had the benefit of the B property in London.
  • Arising from the length of the marriage and the couple’s wide investment portfolio, their finances were highly intertwined. Owing to the passage of years and the complexity of multiple payments and income from various properties, it is best to regard the direct contribution calculations as rather rough and ready, a holistic painting rather than a detailed photograph. It would not be inapposite, in these circumstances, to adjust the figure to a number “in the round”.
  • Court held that an equal division gives appropriate dignity to their joint past endeavour, while giving parties a sound platform upon which to build their future.
  • Ordered for 50/50.

  Maintenance for the children

  • Maintenance between IJ and AM
    • Court already considered the children’s expenses as expenditure out of the matrimonial pool and it would be duplicitous to consider them again as arrears.
    • Court therefore only considered the children’s maintenance on and after IJ date, into the future.
  • Proportion of contribution from each parent
    • H does not dispute that there was an agreement for him to maintain the children in the UK..
    • However, the younger two children have been treating him with utter disrespect to their friends since 2013 and H had also been solely maintaining the eldest son since given the polarisation.
    • [85]: Marital agreements which relate to the maintenance of children could be relevant in determining the quantum of maintenance to order: AUA v ATZ [2016] 4 SLR 674.
    • Undergirding these provisions is the principle of common but differentiated responsibilities: both parents are equally responsible for providing for their children, but their precise obligations may differ depending on their means and capacities: AUA at [41]; TIT v TIU at [61].
    • [86]: In considering the weight placed on the terms of a marital agreement on the quantum of maintenance for the children: (1) The welfare of the child is the overriding objective; (2) A parent will not be allowed to abdicate his or her responsibility of parental support.
    • [86]: Where the parties have clearly addressed their minds to the need to provide and care for the child, and the overall provision is just and fair and does not fall short of what was is and expected under the general law, nothing prevents a court from endorsing the substance of the agreement.
    • [86]: However, if the agreement would leave the child with inadequate support, or if the burdens of parenthood thereunder are so unevenly distributed as to be inconsistent with the principle of common but differentiated responsibilities, the court will step in to ensure a just and fair outcome that served the child’s best interest: AUA at [41] and [46].
    • The court considered that the amount of money the H has and will spend for the eldest son’s expenses exceeds those of the W for the younger two. Court ordered for H to maintain the education expenses for the older son, and for the W to bear the education expenses of the younger son. The daughter has completed her studies.